Open Access Research Article
WHISTLEBLOWERS: UNVEILING TRUTH, UPHOLDING INTEGRITY BY: ROLLY TYAGI & MOLLY TYAGI
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WHISTLEBLOWERS:
UNVEILING TRUTH, UPHOLDING INTEGRITY
BA LLB(H)
2020-2025
Amity
University Noida, Uttar Pradesh
ABSTRACT
Whistle blowers are individuals of
great courage who reveal instances of wrongdoing, corruption, and misconduct
within various organizations. This research paper explores the significant role
they play in fostering transparency, accountability, and ethical behaviour in
society. They bear witness to unethical practices, breaches of ethics, and at
times even criminal activities within their workplaces, government entities, or
other organizational settings. Driven by a strong moral compass, a dedication
to justice, or a commitment to safeguarding the public interest, they make the
choice to speak out despite the considerable personal risks involved. The
challenges faced by whistle blowers are substantial. They often encounter
reprisals from their employers, including the loss of employment, harassment,
and harm to their professional trajectories. Emotional distress and social
isolation frequently accompany their journey. Engaging with the legal system
can be an intimidating experience, marked by uncertain outcomes and potential
consequences for both whistle blowers and those accused of misconduct. To
confront these formidable challenges, many nations have enacted legal
safeguards. Legislation such as the Whistleblower Protection Act in the United
States and the Whistleblower Protection Act of 2014 in India is designed to
shield whistle blowers from retaliation and offer avenues for reporting
misconduct. These laws recognize the indispensable role played by whistle
blowers in preserving the broader public interest. Whistle blowers have wielded
a profound influence on society. Their disclosures have laid bare instances of
corporate fraud, governmental corruption, environmental hazards, and public
health crises. Their actions have prompted legislative reforms, corporate
accountability, and heightened public consciousness. Whistle blowers stand as
sentinels of integrity, serving as a reminder that individuals possess the
capability to unveil the truth and hold institutions accountable.
Keywords: whistle
blower, transparency, fraud, ethical, integrity
INTRODUCTION
Whistleblowing is a key mechanism for
revealing wrongdoing, corruption and unethical practices within organisations
and government bodies. In India, the idea of whistleblowing has gained
importance in recent years as a way to promote transparency, accountability and
good governance. Whistle blowers play a key role in helping disclose instances
of fraud, corruption, environmental violations, public safety hazards and other
forms of misconduct that may remain hidden.
In India, whistle blowers are people
who at their own personal risk, disclose information about illegal or unethical
activities happening within their workplace or public institutions. These
people are driven by a sense of responsibility and commitment to the principles
of honesty and justice. Their main aim to protect the interests of public and
society at large.
To motivate whistle blowers and
provide them with legal protection, the Government of India has taken a number
of legislative measures, including the Whistleblower Protection Act, 2014[1].
The Act aims to safeguard whistle blowers from victimization and retaliation
while ensuring confidentiality of their identities. It also provides mechanisms
for the investigation of complainants and the imposition of penalties on those
who harm or threaten whistle blowers.
Whistle blowers in India are critical
stakeholders in the fight against corruption and the promotion of ethical
governance. Their willingness to step forward with evidence of wrongdoing helps
to maintain the integrity of public and private organisations, preserve the
rule law and strengthen the basis of a just and accountable society.
TYPES OF WHISTLE BLOWER
Internal Whistle Blower
Internal whistle blowers are
individuals who work within an organization and choose to report misconduct,
fraud, unethical behaviour, or any form of wrongdoing they witness or suspect
occurring within their workplace. These courageous employees or insiders play a
vital role in maintaining the integrity of their organization and promoting
ethical practices.
Internal whistle blowers often have a
deep commitment to the principles of transparency, accountability, and ethical
conduct. Their motivations can vary, from a sense of duty to protect their organization’s
reputation to genuine concern for the well-being of colleagues, clients, or the
public. They may use internal reporting mechanisms provided by their
organization, such as confidential hotlines, compliance departments, or
designated reporting channels.
By coming forward with information
about misconduct, internal whistle blowers help their organizations address
issues before they escalate into more significant problems, legal liabilities,
or reputational damage. They also contribute to a culture of ethical
compliance, where employees are encouraged to act in accordance with the law
and organizational values.
External Whistle Blower
External whistle blowers are
individuals who, despite not being directly affiliated with an organization,
expose misconduct, fraud, or unethical behaviour within that organization to
external entities, such as government agencies, law enforcement, regulatory
bodies, or the media. These individuals often play a critical role in revealing
wrongdoing that may otherwise remain hidden, contributing to accountability and
transparency.
By taking their concerns outside the
organization, external whistle blowers help initiate investigations, legal
actions, or public scrutiny, which can lead to corrective measures, sanctions
against wrongdoers, and improvements in organizational practices. They serve as
a vital check on the abuse of power, corruption, and unethical practices.
External whistle blowers exemplify
the importance of civic responsibility and the role of concerned individuals in
upholding ethical standards, safeguarding public interest, and promoting a
culture of accountability in organizations and society at large.
Alumni Whistle Blower
An alumni whistle blower refers to a
former member of an organization, institution, or company who discloses
instances of misconduct, fraud, or unethical behaviour that they have become
aware of after leaving the organization. These individuals, driven by a
commitment to integrity and ethical values, use their insider knowledge to
expose wrongdoing. Alumni whistle blowers may bring attention to issues in
their former workplace to promote accountability, transparency, and positive
change. Their actions contribute to the organization's reform and the broader
goal of ensuring ethical conduct, even after they have moved on from their
association with it.
Open Whistle Blower
An open whistle blower is an
individual who openly and publicly discloses information about misconduct,
corruption, or unethical practices without concealing their identity. They do
not use anonymity or confidentiality measures when coming forward with their
revelations. Open whistle blowers are often driven by a strong sense of moral
duty, and they choose to expose wrongdoing without fear of retaliation or
repercussions. Their willingness to publicly share information about misconduct
helps raise awareness, initiate investigations, and promote transparency and
accountability. While they may face potential risks and challenges, open
whistle blowers aim to shed light on issues that require public attention and
action.
Anonymous Whistle Blower
An anonymous whistle blower is an
individual who, while possessing crucial information about misconduct, fraud,
or unethical behaviour, chooses to keep their identity concealed when reporting
these issues. Anonymous whistle blowers often fear reprisals or retaliation,
making anonymity essential for their safety. This protection allows them to
come forward with sensitive information, fostering transparency,
accountability, and ethical practices within organizations and institutions.
EFFECTS
Positive Effects
·
Exposure
of Wrongdoing: Whistleblowing brings to light instances of misconduct,
fraud, corruption, and unethical behaviour that may otherwise remain hidden.
This exposure is essential for addressing and rectifying these issues.
·
Accountability: Whistleblowing
holds individuals and organizations accountable for their actions. Wrongdoers
are more likely to face consequences for their behaviour, whether through legal
action, internal investigations, or public scrutiny.
·
Transparency: Whistleblowing
promotes transparency within organizations and institutions. It encourages open
dialogue about ethical standards, compliance, and the importance of adhering to
laws and regulations.
·
Prevention
of Harm: Whistleblowing can prevent harm to the public, consumers,
employees, or the environment. For example, it can stop the distribution of
unsafe products, environmental pollution, or financial fraud before it causes
significant damage.
·
Ethical
Culture: Encouraging whistleblowing fosters a culture of ethics and
integrity within organizations. Employees are more likely to act in accordance
with the law and ethical guidelines when they know that wrongdoing will not be
tolerated.
·
Legal
Protections: Whistleblowing laws and protections ensure that individuals
who come forward are shielded from retaliation or harm. These legal safeguards
encourage more people to report misconduct.
·
Improved
Governance: In government and public institutions, whistleblowing can lead
to improved governance, reduced corruption, and enhanced public trust in the
system.
·
Efficiency
and Effectiveness: In private organizations, whistleblowing can lead to increased
operational efficiency and effectiveness. It can help identify inefficiencies
or wasteful practices.
·
Prevent
Future Misconduct: Whistleblowing cases often result in reforms and policy
changes that prevent future instances of misconduct. Lessons learned from
whistleblowing can lead to stronger regulations and compliance mechanisms.
·
Inspiration
for Others: Whistle blowers can inspire others to come forward with their
concerns, creating a snowball effect that encourages more ethical behaviour and
disclosures.
Negative Effects
·
Retaliation: Whistle
blowers frequently face retaliation from their employers, colleagues, or
superiors. This can take the form of harassment, demotion, termination, or even
blacklisting in their industry. Retaliation can have severe personal and
professional consequences for the whistle blower.
·
Isolation: Whistle
blowers may experience social isolation, both at work and in their personal
lives. Colleagues may distance themselves, and friends and family may be
hesitant to associate with someone who has exposed wrongdoing.
·
Emotional
Distress: Whistleblowing can lead to significant emotional stress,
including anxiety, depression, and post-traumatic stress disorder. The process
of reporting misconduct and facing the backlash can take a toll on the whistle
blower’s mental health.
·
Legal
Battles: Whistle blowers may become embroiled in lengthy and costly legal
battles with their employers or the organizations they have reported. This can
drain their financial resources and consume their time and energy.
·
Career
Disruption: Whistleblowing can disrupt a person’s career, particularly if
they are unable to find new employment due to industry blacklisting or the
stigma associated with being a whistle blower.
·
Loss
of Privacy: Whistle blowers may lose their privacy as their personal lives
and actions come under scrutiny during investigations or legal proceedings.
·
Loss
of Trust: Organizations may suffer reputational damage, loss of public
trust, and financial setbacks as a result of whistleblowing revelations.
·
Impact
on Relationships: Whistleblowing can strain relationships with family and
friends who may not fully understand or support the whistle blower’s
actions.
·
Public
Scrutiny: Whistle blowers who go public with their disclosures may face
media attention and public scrutiny, which can further compound the stress and
emotional toll of their actions.
WHISTLE BLOWER PROTECTION IN INDIA
Companies Act, 2013
Section 177(9)[2] of
the Companies Act, 2013 mandates that all publicly listed companies are
required to establish a vigilant mechanism, including a whistle-blower policy,
aimed at facilitating the reporting of concerns by employees and senior
executives. The intent and effectiveness of such a whistle-blower policy depend
on the organization's commitment to its creation and implementation.
Key aspects of the framework for this
policy are as follows:
·
Reporting
Channels: The policy should establish clear channels for reporting violations
at all levels within the organization, with the Chairman of the Board
overseeing these channels.
·
Inclusivity:
All employees, from entry-level staff to directors, should be permitted to
report any violations, which may include discrimination, wilful negligence of
quality, colluded fraud, or misappropriation of budgets.
·
Investigation:
Upon receiving a report, senior management should initiate an investigation,
with false evidence treated as a serious matter.
·
Protection:
The policy must guarantee zero harassment of the whistle blower by the management
and strictly prohibit retaliation in any form.
·
Confidentiality:
Full confidentiality should be maintained at all times to safeguard the whistle
blower.
·
Exceptions:
The policy should specify that whistle blowers will not be protected from disciplinary
action if their allegations are proven to be unfounded and made with malicious
intent.
The Companies Act 2013 encompasses
the entire framework for inquiry, investigation, and inspection under one
chapter (sections 206 to 229). These provisions increase the identification of
wrong practices by external agents, potentially transforming them into external
whistle blowers.
Section 208[3]
empowers an Inspector (other than the registrar) to scrutinize records and
recommend further investigation in cases of doubt, while Section 210 empowers
the Central Government to order an investigation based on recommendations from
the registrar, Inspector, public interest, or a special resolution passed by
the company.
Section 211[4] led to the establishment of the Special Fraud
Investigation Office (SFIO) with the authority to arrest individuals for
specified fraud offenses. Auditors, who were previously not legally empowered
to identify fraud, are now obligated to act as whistle blowers and report such
acts directly to the Central government or relevant authorities.
Securities and Exchange Board of India (SEBI)
The Securities and Exchange Board of
India (SEBI) issued a circular on August 26, 2003, amending the Principles of
Corporate Governance outlined in the standard Listing Agreement. In the
previous version of the Listing Agreement, Clause 49 addressed the
establishment of a Whistle blower Policy for companies. However, it wasn’t
obligatory to implement such a policy, although many companies voluntarily embraced
it due to its positive impact on compliance and governance standards.
Nonetheless, companies were mandated to disclose whether they had adopted such
a policy and provide information about the number of reported events under the
policy, as well as the number of cases resolved or pending.
Now, SEBI has replaced the Listing
Agreement with the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015. Under Regulation 22 of these regulations, listed companies
are obligated to have a whistle blower mechanism in place for their employees
and directors.
Whistleblower Protection Act, 2014
The Whistleblower Protection Act of
2014[5]
incorporates a range of provisions designed to protect whistle blowers and
enhance transparency and accountability. The main elements of the Act can be
summarized as follows:
·
Complaint
Receiving Mechanism: The Act establishes a mechanism for receiving complaints
concerning corruption or the misuse of power by public servants.
·
Protection
from Retaliation: Adequate safeguards are provided in the Act to shield whistle
blowers from victimization or reprisals resulting from their disclosures.
·
Competent
Authorities: The Act outlines various competent authorities to whom disclosures
in the public interest can be made. Each authority is assigned specific
responsibilities based on the nature of the complaint. For instance, the Prime
Minister serves as the competent authority for complaints against Union
Ministers.
·
Identity
Disclosure and Timeframe: Complainants are required to disclose their identity,
and anonymous complaints are not permitted. Complaints must be filed within a
maximum timeframe of seven years.
·
Exemptions
and Appeals: Certain personnel, such as those affiliated with the Special
Protection Group, are exempted from the Act’s provisions. Furthermore,
individuals dissatisfied with a Competent Authority’s decision can appeal to
the respective High Court within sixty days.
·
Penalties
for Identity Disclosure: Revealing the identity of a complainant can result in
imprisonment for up to three years and a fine of up to Rs 50,000. Knowingly
providing false or misleading information may lead to imprisonment for up to
two years and a fine of up to Rs 30,000.
·
Annual
Report: The Competent Authority is mandated to compile an annual report
detailing its activities and submit it to the Central or State Government,
which subsequently presents it before the respective Parliament or State
Legislature.
·
Overriding
Effect: The Whistleblower Protection Act takes precedence over the Official Secrets
Act of 1923, allowing for disclosures that do not compromise the nation’s
sovereignty.
EXAMPLES
Example 1
Satyendra Dubey, one of India’s
earliest whistle blowers, served as an Indian Engineering Services (IES)
officer and was appointed as a project director for the National Highway
Authority of India. His responsibilities included overseeing the construction
of a segment of NH 2 (The Grand Trunk Road) within the Aurangabad-Barachatti
section. This highway project was a significant part of former Prime Minister
Atal Bihari Vajpayee’s ambitious infrastructure initiative known as the ‘Golden
Quadrilateral Project’, situated in the Koderma district of Jharkhand. Dubey
exposed financial irregularities within the project’s operations, leading to the
suspension of three engineers employed by the contractor. Unfortunately, on
November 27, 2003, while returning from a wedding in Varanasi, tragedy struck
as Dubey was fatally shot after reaching Gaya. His body was discovered by the
roadside in A.P colony by his driver. In recognition of his courageous actions,
Satyendra Dubey was posthumously honoured with the ‘Whistle blower of the Year’
award by the London-based organization Index on Censorship.
Example 2
Shanmugam Manjunath, a computer
science engineer and a grade ‘A’ government officer at the Indian Oil
Corporation (IOC), exposed corruption at two petrol pumps in Lakhimpur Kheri,
Uttar Pradesh. While in his capacity, he took action by sealing the two petrol
pumps, which were found to be selling adulterated fuel. Furthermore, he
conducted surprise raids when these pumps resumed operations after a month.
Unfortunately, on November 19, 2005, Manjunath met a tragic end when he was
shot six times in the town of Gola Gokarannath in Lakhimpur Kheri. His body was
discovered in the backseat of his own car, which was being driven by two
employees of the petrol pump.
Example 3
Lalit Mehta, an engineer actively
engaged in the ‘The Right to Food’ campaign in Palamu district, Jharkhand,
exposed corruption within the Mahatma Gandhi National Rural Employment
Guarantee scheme. He conducted a social audit of the scheme with the assistance
of economists but was tragically murdered before he could fully uncover the
extent of the scam. On May 15, 2008, Mehta was attacked while riding his bike
in Chhatarpur district, Madhya Pradesh.
Example 4
Indian Police Service (IPS) officer
Narendra Kumar Singh, in 2012, unveiled a mining scandal in Morena district,
Madhya Pradesh, known for its high-quality construction sand. Despite numerous
threats, Singh actively monitored the activities of the illegal sand mining
mafia, which was illicitly transporting sand out of the district to other parts
of Madhya Pradesh. On March 8, 2012, Singh received a tip about illegally mined
stones being transported via tractor. Upon reaching the location to intervene,
he was run over by the tractor and tragically lost his life on the spot.
SUGGESTIONS AND CONCLUSION
Every company should offer a means
for whistle blowers to report problems anonymously. Utilizing independent
platforms like the corporate whistle blower initiative can be beneficial in
encouraging employees and other stakeholders to come forward with their
concerns. Many companies worry that permitting anonymous complaints might lead
to a surge in frivolous, mischievous, and malicious reports that could be
challenging to address. To address this concern, companies may establish a list
of activities that qualify as unfair and unethical practices, and the whistle
blower mechanism should exclusively handle issues related to these activities.
The policy should explicitly outline
the necessary information required in a complaint to initiate an investigation.
The focus of the whistle blower policy should prioritize the message itself
rather than the identity of the whistle blower.
Human beings tend to be risk averse
by nature. Therefore, it’s essential to incentivize whistle blowers, either
through monetary or non-monetary means, to encourage their reporting. Companies
might consider implementing an incentive program to motivate whistle blowers to
report issues.
REFERENCES
·
Shikha
Patheja, System of Whistleblowing in India, SRCC (July 2015), https://www.srcc.edu/sites/default/files/B.Com(hns)_IIIyrSem6_BCh6.1_A&CG_Week6_Anisha.pdf.
·
Charmaine Lym & Melvyn Zhang, The
Consequences of Whistleblowing: An Integrative Review, RESEARCH GATE (June
2017), https://www.researchgate.net/publication/318152489_The_Consequences_of_Whistle-blowing_An_Integrative_Review.
·
LIVE
MINT, https://www.livemint.com/news/india/just-how-safe-are-whistleblowers-under-indian-law-11571763505941.html (last visited Sept. 1, 2023).
Article Information
WHISTLEBLOWERS: UNVEILING TRUTH, UPHOLDING INTEGRITY BY: ROLLY TYAGI & MOLLY TYAGI
Authors: ROLLY TYAGI, MOLLY TYAGI
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/09/04
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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